Reports: most iPhone 4 line-waiters are iPhone upgraders

Lines once again wound around Apple Stores across the country for the iPhone 4 …

Two analyst reports claim that a large majority of customers waiting in line for yesterday's US iPhone launch were repeat customers. According to Piper Jaffrey’s Gene Munster, 77 percent of those waiting in line already owned an iPhone, while Oppenheimer analyst Yair Reiner found a very similar 76 percent of customers in the same boat. According to the Oppenheimer numbers, the average length of time before upgrade was 14.7 months.

Munster, who polled a total of 608 people across San Francisco, Minneapolis, and New York City, also found that 16 percent of the line dwellers were making the switch to AT&T from another carrier. A little more than half of iPhone 4 purchasers were there for the phone with the highest storage capacity. That's up from 43 percent in 2009, but it doesn't reach the astronomical mark of 95 percent when the original iPhone launched in 2007.

Reiner estimates that Apple will sell 1.5 million iPhone 4 units during the launch, a number which would trump last year’s iPhone 3GS opening weekend sales by 500,000. At the same time, Munster claims the launch numbers are largely irrelevant due to the brand loyalty that Apple has assembled over the past three years.

He points out that what's much more important than opening day numbers are the hordes of iPhone users who continue to upgrade as their contracts expire, despite vocal displeasure with AT&T service in some regions.

60 Reader Comments

He points out that what's much more important than opening day numbers are the hordes of iPhone users who continue to upgrade as their contracts expire, despite vocal displeasure with AT&T service in some regions.

Why not? Switching carriers, at best, allows you to trade one problem for another problem. To my knowledge, no carrier in the US has all of: excellent customer service; excellent network coverage; and excellent selection of popular handsets. At best you can pick two.

Brand loyalty is a powerful force for Apple, but their new customer numbers are not going to see significant growth until they either do something amazing and completely original with the iPhone brand, or open up their availability to other carriers outside of AT&T in the US.

Why not? Switching carriers, at best, allows you to trade one problem for another problem. To my knowledge, no carrier in the US has all of: excellent customer service; excellent network coverage; and excellent selection of popular handsets. At best you can pick two.

*cough* Verizon *cough*

I had Verizon for two years before moving to Alaska where they don't have native coverage. I've since switched to a local carrier here, and would LOVE to be able to go back to Verizon. I had a chance at switch over to try out AT&T and the iPhone, but I didn't, simply because AT&T is terrible. You don't have to believe just me, there's plenty of ratings on different websites to back me up.

I'll try an iPhone when they are no longer exclusive to AT&T. For now, my Android phone keeps me happy. Also, before someone tells me to get an unlocked iPhone, there are no 3G GSM carriers here in Alaska besides AT&T.

The people around me in my line at Pentagon City, VA (who I got to know rather well over the course of my 8-hour wait) *all* had either an iPhone, mostly 3G, or an iPad. They seemed about evenly divided between 16GB and 32GB iPhone 4s, and the division, unsurprisingly, correlated well with their wealth.

So at least 23% are new customers? Maybe I'm missing something, but to me that still seems like a very good figure.

These numbers don't say that. There could be 23% new customers, but there could also be 23% "prefer not to respond." Without looking at the full data, you can't say much about the 23% that did not answer "already have an iPhone."

The average length of time between upgrades at 14.7 months is shocking. I know AT&T extended the period people could upgrade over, but if the average is that low, how many people were upgrading at <12 months?

The only way apple will get widespread market growth outside of those whom have already bought an iPhone at this point is to either 1) Free phone on contract (make it up with that new limited data plan costs) or 2) Unlock the hardware from a carrier and sell the phone for under $300.

I'd Personally love a smartphone that was unlocked and able to jump to any carrier for cheaper than to get a cutting edge eye-bleeding resolution phone that requires a 2 year contract.

How likely is it for a company to create an unlocked android phone for about $300 that isn't as powerful or cutting edge? I imagine that would expand the market base greatly.

Edit: I guess I'm saying, cost matters. And the yearly "better version" doesn't help with the cost investment for people without a lot of disposble income.

He points out that what's much more important than opening day numbers are the hordes of iPhone users who continue to upgrade as their contracts expire, despite vocal displeasure with AT&T service in some regions.

Why not? Switching carriers, at best, allows you to trade one problem for another problem. To my knowledge, no carrier in the US has all of: excellent customer service; excellent network coverage; and excellent selection of popular handsets. At best you can pick two.

But AT&T has zero of these. Their customer service is atrocious, their network coverage sucks, and they only sell one phone that anyone seems to want. Come to think of it, no carrier in the US has much for handset selection at the upper end of the spectrum. Well, T-Mobile might...

The only way apple will get widespread market growth outside of those whom have already bought an iPhone at this point is to either 1) Free phone on contract (make it up with that new limited data plan costs) or 2) Unlock the hardware from a carrier and sell the phone for under $300.

I'd Personally love a smartphone that was unlocked and able to jump to any carrier for cheaper than to get a cutting edge eye-bleeding resolution phone that requires a 2 year contract.

How likely is it for a company to create an unlocked android phone for about $300 that isn't as powerful or cutting edge? I imagine that would expand the market base greatly.

An unlocked Nexus One is $529 but is also more "cutting edge" than you're requiring.

A quick search found that Amazon has the HTC Tattoo unlocked for $270. It's an Android 1.6 phone so it's a smartphone but not a cutting edge one.

I'm sure Apple (and many other companies) has a second curve all mapped out for when they can offer an upgraded feature set and the early adopter types that are loyal to their company are ready to buy again.

Pretty good reason to have the first edition of the iPad stripped of obvious features...even more reason to upgrade to iPad 2.

I will be looking into them for sure, but from what I read here, many people experience problems with them as well. The things that come to my mind recently is that they apparently just stop pushing out Android updates, and they routinely disable hardware features. That's not customer service to me.

My AT&T contract is up in a couple weeks, and while I don't need a smartphone, I'm at least considering catching up to 2004 by getting one. I'm overwhelmed (not as in "impressed" - but rather, in a bad way) by the choices.

Building off the earlier comment, that 23% could theoretically all be current AT&T customers who simply don't own smartphones.

Why not? Switching carriers, at best, allows you to trade one problem for another problem. To my knowledge, no carrier in the US has all of: excellent customer service; excellent network coverage; and excellent selection of popular handsets. At best you can pick two.

*cough* Verizon *cough*

I had Verizon for two years before moving to Alaska where they don't have native coverage. I've since switched to a local carrier here, and would LOVE to be able to go back to Verizon. I had a chance at switch over to try out AT&T and the iPhone, but I didn't, simply because AT&T is terrible. You don't have to believe just me, there's plenty of ratings on different websites to back me up.

I'll try an iPhone when they are no longer exclusive to AT&T. For now, my Android phone keeps me happy. Also, before someone tells me to get an unlocked iPhone, there are no 3G GSM carriers here in Alaska besides AT&T.

Well, there is always GCI, but they use AT&T's network for their 3G coverage.

I will be looking into them for sure, but from what I read here, many people experience problems with them as well. The things that come to my mind recently is that they apparently just stop pushing out Android updates, and they routinely disable hardware features. That's not customer service to me.

The Android update complaints have been largely ignorance. People were complaining weeks ago that Verizon hadn't pushed Froyo to their Droid. It's kind of hard to blame Verizon for that when Motorola hadn't yet written the Froyo update for the Droid because Google hadn't released the source code yet. Real complaints about any carrier not pushing out version updates are extremely rare.

Likewise, the only disabled hardware features I'm aware of (which is obviously not all inclusive) are the limitations that Motorola has placed on their phones (not Verizon's work) and the WiFi tethering thing (Verizon charges for it).

I've asked this on Ars before and never gotten a response, what things does Verizon do that makes some people compare them to the disaster that is AT&T?

This is surprising? I'd be more surprised if a lot of people were *not* repeat customers. For all the bitching and moaning by what is actually the small minority of people that write and comment on tech blogs, a lot of people have obviously been happy enough with their iPhones and AT&T to keep buying new ones. Just sayin'.

@squidz: Thanks for clarifying that. I'll look back at the comments, but I'm pretty sure the OS update issues were more than that - like, they'd be selling a 1.6 handset right next to a 2.1 handset, but if you bought the 1.6 it would be stuck on that version for good. This is something I'll definitely ask about as I shop.

I can't answer your question, but I would love to hear from someone who can. I was with T-Mobile for many years but dropped them because of terrible coverage, and I've been on AT&T for two years with no issues of any kind (albeit, not a smartphone).

Come to think of it, no carrier in the US has much for handset selection at the upper end of the spectrum. Well, T-Mobile might...

Verizon: Motorola Droid, HTC Incredible, Palm Pre Plus, Droid X and Droid 2 in the near futureSprint: HTC Evo, Samsung Galaxy in the near future, at the slightly lower end they have Samsung Moment and Palm PreT-Mobile: Nexus One, HD2? I dunno. Haven't kept up. Not sure of any other higher end devices. Lots of good mid-range stuff like the myTouch variantsAT&T: iPhone

I've asked this on Ars before and never gotten a response, what things does Verizon do that makes some people compare them to the disaster that is AT&T?

Not too much. The prices are up there with AT&T at the high end so some may not prefer them over more competitive carriers. In the past Verizon would disable features that they wanted to monetize (like disabling the built-in GPS chips in phones, etc.)

It seems all of the carriers make it less than obvious that wifi tethering is not limited to their paid apps. Bridging a Wifi and cellular or Wimax radio is something that most devices are capable of as long as they aren't configured to be deliberately blocked or hidden by default. Usually it's just a matter of installing the app as a superuser but many carriers are guilty of this.

I will be looking into them for sure, but from what I read here, many people experience problems with them as well. The things that come to my mind recently is that they apparently just stop pushing out Android updates, and they routinely disable hardware features. That's not customer service to me.

The Android update complaints have been largely ignorance. People were complaining weeks ago that Verizon hadn't pushed Froyo to their Droid. It's kind of hard to blame Verizon for that when Motorola hadn't yet written the Froyo update for the Droid because Google hadn't released the source code yet. Real complaints about any carrier not pushing out version updates are extremely rare.

Likewise, the only disabled hardware features I'm aware of (which is obviously not all inclusive) are the limitations that Motorola has placed on their phones (not Verizon's work) and the WiFi tethering thing (Verizon charges for it).

I've asked this on Ars before and never gotten a response, what things does Verizon do that makes some people compare them to the disaster that is AT&T?

Earlier in my days with Verizon I used to curse them for disabling certain bluetooth functionality (OBEX) and the ability to connect to a computer (the moto RAZR was severely crippled on their network compared to others).

Moving up to smart phones, there seem to be fewer, if any, carrier imposed restraints. GPS was locked on the windows mobile phone that I had through them, unless you used their POS navigator software (no thanks). The android phones they have seem pretty functional though. I have a droid and have found no reason to root it. Not to unlock any functionality at least.

@squidz: Thanks for clarifying that. I'll look back at the comments, but I'm pretty sure the OS update issues were more than that - like, they'd be selling a 1.6 handset right next to a 2.1 handset, but if you bought the 1.6 it would be stuck on that version for good. This is something I'll definitely ask about as I shop.

I can't answer your question, but I would love to hear from someone who can. I was with T-Mobile for many years but dropped them because of terrible coverage, and I've been on AT&T for two years with no issues of any kind (albeit, not a smartphone).

At the moment, I wouldn't buy a 1.6 phone. Many of them should be getting upgrades to Eclair (2.1) but I wouldn't count on Froyo (2.2). HTC has guaranteed 2.2 on all of their current 2.1 phones. I believe that Motorola has done the same with their's. I have no idea what LG or the other manufacturers are going to do about updates.

Personally, I'd research a few phone online, then go to the store to try them out. That way you know which ones you can just ignore before there's someone pressuring you to buy them.

I've asked this on Ars before and never gotten a response, what things does Verizon do that makes some people compare them to the disaster that is AT&T?

I have a mobile data card for verizon. It is rarely used, just eating up whats left of its contract time now.

The day I got it, I set up auto-withdrawl for paying the bill. The first month worked. It's been messed up 3 times in less than a year though.

no idea how. Screw verizon.

That was my experience with Verizon as well. They over billed me every month, and every month I would need to make a phone call (usually accompanied by at least a half hour on hold) to get them to remove the charges. This wasn't once or twice, this was nearly every month. Of course this was years ago, I would expect that maybe things changed by now...but maybe not.

After I got out of my Verizon contract I went to Cingular (prior to them becoming AT&T), so I've been with them ever since, and with them long before I got my first iPhone. While I hesitate to sing praises about any company, my experience with AT&T as my mobile provider has been generally positive. The service is quite good in my area.

I do hope that Apple eventually makes a Verizon branded iPhone. I imagine scores of iPhone users will flee AT&T and make the switch, which will lessen the traffic for remaining users. While it doesn't affect me that much, it would be nice to not have to hear so much whining about AT&T.

If Verizon had the iPhone now, would the network really be up to the task?

He points out that what's much more important than opening day numbers are the hordes of iPhone users who continue to upgrade as their contracts expire, despite vocal displeasure with AT&T service in some regions.

Why not? Switching carriers, at best, allows you to trade one problem for another problem. To my knowledge, no carrier in the US has all of: excellent customer service; excellent network coverage; and excellent selection of popular handsets. At best you can pick two.

But AT&T has zero of these. Their customer service is atrocious, their network coverage sucks, and they only sell one phone that anyone seems to want. Come to think of it, no carrier in the US has much for handset selection at the upper end of the spectrum. Well, T-Mobile might...

In Chicago I used Sprint because AT&T sucked and Verizon was meh. When I moved to Central Florida Sprint and Verizon both sucked hard and since the iPhone had come out I switched to AT&T and it worked great. Then I moved to Northern Virginia where AT&T is okay not great, Verizon is great, and Sprint still kind of sucks.The moral of the story is that network quality is primarily just a function of geography. People on Ars will complain about AT&T a lot because I assume people here are disproportionately concentrated in San Fran. and NYC, but I could be wrong about that.

Customer service is bad all around no matter what unless you’re a long-time customer.

Come to think of it, no carrier in the US has much for handset selection at the upper end of the spectrum. Well, T-Mobile might...

Verizon: Motorola Droid, HTC Incredible, Palm Pre Plus, Droid X and Droid 2 in the near futureSprint: HTC Evo, Samsung Galaxy in the near future, at the slightly lower end they have Samsung Moment and Palm PreT-Mobile: Nexus One, HD2? I dunno. Haven't kept up. Not sure of any other higher end devices. Lots of good mid-range stuff like the myTouch variantsAT&T: iPhone

Are they still selling Palms?

I should have clarified about the original quote, once the Droid X and Droid 2 release, Verizon will join T-Mobile in that group that have some selection, but I meant phones you can go out and buy today.

There's a ton of Android phones on T-Mobile, as well as a number of WinMo phones. I consider the choices minimal because every week there's 2-3 new Android phones released in Europe while the US doesen't get that many in a month. Even with that small of a rate, Android still has the most new handsets come out each month.

He points out that what's much more important than opening day numbers are the hordes of iPhone users who continue to upgrade as their contracts expire, despite vocal displeasure with AT&T service in some regions.

Why not? Switching carriers, at best, allows you to trade one problem for another problem. To my knowledge, no carrier in the US has all of: excellent customer service; excellent network coverage; and excellent selection of popular handsets. At best you can pick two.

But AT&T has zero of these. Their customer service is atrocious, their network coverage sucks, and they only sell one phone that anyone seems to want. Come to think of it, no carrier in the US has much for handset selection at the upper end of the spectrum. Well, T-Mobile might...

I certainly don't defend any phone carrier. AT&T specifically. I cancelled a company account where I had 60 + phones with them. I hesitated - hemmed and hawed about getting an iPhone etc, because of them. I broke down. The iPhone was just to nice to not have. I can honestly say that there customer service has improved and I don't have any of the problems I always hear people complain about. (I do live in a larger metropolitan area - but everybody sucks in the sticks anyway). A lot of times when I hear these complaints I wonder if they are just repeated over and over again till every body just nods their heads yes.

Are they scumbags? - yes.Are they a typical phone company that puts their hands in your pockets for every last cent? - yes.Have they improved? - In all fairness - Yes.

they'd be selling a 1.6 handset right next to a 2.1 handset, but if you bought the 1.6 it would be stuck on that version for good. This is something I'll definitely ask about as I shop.

Some of the older Android phones don't have the hardware to upgrade. I might be remembering this wrong, but I think it was the capacity of their ROM chips.

That's not strictly true. People have hacked the leaked Froyo test builds to run all the way back on the G1. It seems the biggest reason updates aren't coming out is because handset manufacturers don't make any money by making your phone last. They want you to buy a new one, so unless you buy the newest phone on the market, you'll probably see support stop for your device before your 2 year service plan is up.

EDIT (you guys type too fast):Re: not having appropriate hardware to support an OS upgrade - That would be an acceptable reason, I see that.

It's tough to complain about progress, but this sort of thing is actually a negative for the Android platform to me. At least with the iPhone, there's a steady, predictable path for hardware, and the software generally works on all of the handsets (until iOS4). With Android and the rest, if you look across all carriers, it seems there is a new "iPhone killer", each with its own stupid name, released just about every month, and it's impossible for me to keep them all straight.

I've asked this on Ars before and never gotten a response, what things does Verizon do that makes some people compare them to the disaster that is AT&T?

I have a mobile data card for verizon. It is rarely used, just eating up whats left of its contract time now.

The day I got it, I set up auto-withdrawl for paying the bill. The first month worked. It's been messed up 3 times in less than a year though.

no idea how. Screw verizon.

That was my experience with Verizon as well. They over billed me every month, and every month I would need to make a phone call (usually accompanied by at least a half hour on hold) to get them to remove the charges. This wasn't once or twice, this was nearly every month. Of course this was years ago, I would expect that maybe things changed by now...but maybe not.

After I got out of my Verizon contract I went to Cingular (prior to them becoming AT&T), so I've been with them ever since, and with them long before I got my first iPhone. While I hesitate to sing praises about any company, my experience with AT&T as my mobile provider has been generally positive. The service is quite good in my area.

I do hope that Apple eventually makes a Verizon branded iPhone. I imagine scores of iPhone users will flee AT&T and make the switch, which will lessen the traffic for remaining users. While it doesn't affect me that much, it would be nice to not have to hear so much whining about AT&T.

If Verizon had the iPhone now, would the network really be up to the task?

Billing errors suck. With all companies, it seems like they're once they start, they're chronic. Everyone I know who has had a billing error (usually with MSN) has found that once there's one, there's one every other month. I've been lucky enough to not fall into this problem.

I may consider upgrading from my iPhone 3GS to a 4 -- we'll see. Either way, the phone only being available on AT&T here won't have any bearing on it for me.

I'm deaf, so I never make voice calls and thus don't experience dropped calls. Their network here in northeast Ohio is generally quite good and doesn't seem overloaded. Their coverage is a little bit lacking in rural areas, but I've been pleasantly surprised by how widespread the EDGE coverage is in rural northern Ohio. There's been a few times where I've been (annoyingly) without any coverage at all, but I've noticed a very strong correlation between "areas where I have no coverage" and "rural backwaters I don't want to visit ever again" so that's not been a major issue for me either.

The biggest reason I'm staying with AT&T unless Apple drops them entirely, though, is that I've developed a pathological hatred for Verizon's billing department and customer service. I've never had a bad experience with AT&T's customer service, and I've only rarely had good experiences with Verizon's customer service (at retail locations in both cases since phone-based customer/tech support is painful for me). Their billing department is incompetent -- twice I've tried switching to the Droid (and had issues both times), twice I've returned the phone inside the 30 day window (once it was after only 3 days), and twice I've been charged the ETF even though I wasn't supposed to be. Even though I was able to get it reversed in both cases, I was NOT amused to have to deal with that. By contrast, I've never had any issues with AT&T's billing systems.

In short: Every cell carrier sucks -- they just suck in different ways, and I personally find that Verizon sucks a lot more than AT&T does.

I really can't complain about AT&T in southeast Michigan. My closest (spatially) coworker is on Verizon and doesn't get phone or 3G service in our office. I found that alarming, since I haven't seen any dead zones in this large region well over a year on AT&T. I've never dropped a call since buying the first iPhone. I'm sure anyone complaining here has a legitimate issue, but service reliability varies radically.

Anyway.

Interesting report. Note that the launch day numbers were so huge that even %23 might mean in the ballpark of 200,000 to 300,000 new users on the platform in a day. It'll be interesting to see if the mix evens out - I'd imagine those deeply invested in the platform would have the most incentive to wait in those ridiculous lines.

If you were crazy enough to wait in line yesterday, you were probably crazy enough to wait in line a year ago too. It rather surprises me that anyone who doesn't already have an iPhone would wait in line. Of course not every store did have much of a line.

I will be looking into them for sure, but from what I read here, many people experience problems with them as well. The things that come to my mind recently is that they apparently just stop pushing out Android updates, and they routinely disable hardware features. That's not customer service to me.

The Android update complaints have been largely ignorance. People were complaining weeks ago that Verizon hadn't pushed Froyo to their Droid. It's kind of hard to blame Verizon for that when Motorola hadn't yet written the Froyo update for the Droid because Google hadn't released the source code yet. Real complaints about any carrier not pushing out version updates are extremely rare.

Likewise, the only disabled hardware features I'm aware of (which is obviously not all inclusive) are the limitations that Motorola has placed on their phones (not Verizon's work) and the WiFi tethering thing (Verizon charges for it).

I've asked this on Ars before and never gotten a response, what things does Verizon do that makes some people compare them to the disaster that is AT&T?

I agree with most of your points, but just to expand a bit on them...

My opinion on the frequency of updates: Android seems to appeal to geeks quite a bit (myself included.) A lot of geeks like to be on the bleeding edge of technology and have the new hotness right away. So if the newest Android upgrades aren't available for their phone immediately after Google releases the code, they get all up in arms and complain. The truth of the matter is that Android updates are coming out pretty quickly for most of the major handsets (I really can't speak to the frequency of updates to the less-popular handsets.)

A while back in another forum post I made a comparison of the frequency of iPhone OS updates vs frequency of Motorola Droid updates (I have a Droid), and they were pretty equivalent. The Droid has only been out for about 7 months (released in Nov 2009) and has already received one minor bugfix update (2.0.1) and one major point update (2.1). IMO 3.5 months between updates is pretty darn good, especially if you compare it to the historical frequency of Windows Mobile updates (i.e. few and far between, if you get any updates at all.)

And like you said - Froyo/2.2 was just released by Google this week! Of course it's not available on any handsets yet. And if you really can't wait for the official update for your phone, root your phone and install a custom rom - 2.2-based roms will be available within a few weeks if historical trends hold. I haven't done it yet, but I've heard that installing a custom rom isn't that difficult.

Verizon disabling features: I'm pretty sure Verizon historically had a habit of disabling features on their phones. But they seem to have turned over a new leaf with the new Android phones. As far as I've experienced, nothing on my Droid has been disabled. Yes they charge you extra for tethering, if you use the official Verizon method. But you can easily download free or low-cost apps from the Android Marketplace that allow you to tether for no additional monthly charge - and Verizon has done nothing to block these apps.

I've been VERY happy with Verizon since I've been using them for the last 3 years. 3G coverage everywhere I've been in the last 3 years (except up in the mountain pass or at my uncle's house 3 miles back in the forest at the Oregon coast.)

He points out that what's much more important than opening day numbers are the hordes of iPhone users who continue to upgrade as their contracts expire, despite vocal displeasure with AT&T service in some regions.

Why not? Switching carriers, at best, allows you to trade one problem for another problem. To my knowledge, no carrier in the US has all of: excellent customer service; excellent network coverage; and excellent selection of popular handsets. At best you can pick two.

But AT&T has zero of these. Their customer service is atrocious, their network coverage sucks, and they only sell one phone that anyone seems to want. Come to think of it, no carrier in the US has much for handset selection at the upper end of the spectrum. Well, T-Mobile might...

On this, I'd disagree. I think it comes down to each person's personal experience, much like everything else. I've never had a major issue with AT&T customer service, coverage (Houston was the city used for the faster speed test), and I wanted the iPhone. So, other selections didn't really matter.

But, again, that's a purely personal stance. I know someone in my office that claims the exact same thing about Verizon.

Drawn-out point? I think it's safe to say that all companies have their ups and their downs. Our perception of them is typically based on which of those we catch them on.

@squidz: Thanks for clarifying that. I'll look back at the comments, but I'm pretty sure the OS update issues were more than that - like, they'd be selling a 1.6 handset right next to a 2.1 handset, but if you bought the 1.6 it would be stuck on that version for good. This is something I'll definitely ask about as I shop.

I can't answer your question, but I would love to hear from someone who can. I was with T-Mobile for many years but dropped them because of terrible coverage, and I've been on AT&T for two years with no issues of any kind (albeit, not a smartphone).

The HTC Droid Eris shipped with 1.5 (and yes it was selling right next to the Moto Droid which had 2.0). We bought my wife an Eris in November, and yes, it looked like it was never going to be updated to a newer Android version - the phone ran fine for her with 1.5, but she really wanted Google Maps Navigation, which will only run on Android 1.6 or above.

Then all of a sudden out of the blue when we'd almost given up expecting an update, Verizon pushed a 2.1 update to it. (Now that she has Google Maps Navigation, my wife says that her phone is absolutely perfect. The Eris has HTC's Sense UI on it though - which is likely the cause of the delay. That's the risk you take when you get an Android phone with a custom UI like Sense - generally the OS updates take a bit longer to drop, since the manufacturer also has to update the custom UI to be compatible with the new OS version. If getting quick updates is important to you, get an Android phone with stock Android (called "Google Experience" phones) like the original Moto Droid, or the HTC Nexus One.